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'Mr Davos' optimistic ahead of 40th annual meeting

By Paul Armstrong, CNN
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  • 2,500 business leaders and politicians expected in the picturesque alpine ski resort
  • Theme behind this year's event -- to "rethink, redesign and rebuild" the world's economy
  • Klaus Schwab says Davos provides the ideal platform for leaders to rethink the system
  • French President Nicolas Sarkozy to deliver opening address on Wednesday

Davos, Switzerland (CNN) -- On the eve of the 40th World Economic Forum at the Swiss resort of Davos, the economist behind it all says he's optimistic about life after recession.

With somewhere in the region of 2,500 business leaders and politicians expected in the picturesque alpine ski resort for the five-day event, Klaus Schwab told CNN he sensed a determination among them to seize the initiative this year.

"People are thinking much more about why the fire happened," he said.

"I think they are very concerned that the crisis will have a next phase which still has to be defined."

Schwab was referring to the fear among some analysts that the current recovery --- Britain became the latest nation to officially come out of recession Tuesday -- is still very fragile and that we could easily witness a "double dip" recession.

The recent debt crisis in Dubai revealed how jittery the markets remain after the dark days of gigantic bank bailouts.

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With this in mind Schwab pointed to the mantra of this year's event -- to "rethink, redesign and rebuild" the world's economy.

"When we talk about rethinking, we speak mainly about values," he explained. "When we speak about redesigning, we speak about the systems, like the financial system. And rebuilding the institutions."

Schwab was quoted on the World Economic Forum Web site earlier this month saying that "our present system fails to meet its obligations to as many as three billion people in the world. Our civic, business and political cultures must be transformed if we are to close this gap."

He added that Davos provided the ideal platform for leaders to rethink this system.

In his opening address on Wedensday, French President Nicolas Sarkozy is expected to touch on the "world after the crisis" and "the regulation of financial markets." Sarkozy has pushed for tighter international regulations and limits on bankers' bonuses.

Meanwhile, a number of high-profile bankers -- especially from Wall Street -- are expected in Davos, after shunning last year's event, in an attempt to avoid the unquestionable hostility directed towards their sector.

Asked whether he thought some bankers would use Davos only as a lobbying tool against the kind of banking regulation favored by Sarkozy, Schwab remained positive. "I think Davos is built on dialogue," he said.

"Of course everybody will try to push his own interests," he added. "But at the end you become aware that it's not only your interests that count, but there are other groups who have different interests.

"And if you can find and adapt, in the process of interaction in Davos, your own point of view, then I think then we have managed a great achievement."